Nonetheless, the larger story is the increase in manufacturing activity in February, and the principle driver of these higher figures was higher sales. The index for new orders increased from -7.2 to 13.3, a significant shift. Indeed, the percentage of businesses with higher sales this month increased from 27.9 percent in January to 35.9 percent in February. Similar responses were seen for shipments and employment. Even with the faster pace of hiring, though, it should be noted that almost 72 percent of manufacturers did not change their employment levels. As we have seen in other indicators, hiring continues to lag other measures even as other measures have started to improve.

This more-positive assessment flows into the forward-looking data, as well. The index of general business conditions based on the respondents’ future expectations rose from 22.4 to 33.1, with roughly half of those surveyed anticipating better conditions six months from now. Measures for new orders, shipments, employment, and capital spending were all higher. Inventories are not expected to change, and pricing pressures should remain elevated.

Chad Moutray is chief economist, National Association of Manufacturers.

Chad Moutray is chief economist for the National Association of Manufacturers (NAM), where he serves as the NAM’s economic forecaster and spokesperson on economic issues. He frequently comments on current economic conditions for manufacturers through professional presentations and media interviews. He has appeared on Bloomberg, CNBC, C-SPAN, Fox Business and Fox News, among other news outlets.